Electrifying the Base of the Pyramid through Innovative Micropayment Technology

$100,00 | Stage 1: Proof of Concept | Energy

The problem: Expensive, inefficient, and often dangerous energy in off-grid areas

Worldwide, over 1.5 billion people live without access to centralized power. Angaza’s initial target market is East Africa, home to over 300 million off-grid consumers. To meet basic energy needs, these East Africans rely on expensive, inefficient and often dangerous sources of energy, such as kerosene fuel. While sunshine is abundant, and solar lights and mobile phone chargers are widely available, their prohibitive upfront cost has prevented their large-scale adoption.

The solution: Pay-as-you-go power

Angaza is a technology company that offers hardware and software solutions to power Pay-As-You-Go (PAYG) financing to meet the demand for energy in off-grid markets in Africa. The Angaza PAYG platform allows customers to make secure mobile payments to power their pico-solar devices, which are equipped with meters to track the energy purchased and the energy consumed. This innovative, low-cost technology system allows consumers to purchase solar energy products in small increments over time. Angaza PAYG eliminates the upfront price barrier of solar power, makes clean energy affordable for all, and dramatically expands the global market for pico-solar devices.

Angaza

Angaza offers a technology solution to solar-device financing that can overcome these hurdles and help clean energy finally achieve substantial penetration in off-grid emerging markets. The majority of families and small businessesin Tanzania are kerosene-dependent, but the vast majority of adults own a cellular phone, and an ever-growing number use mobile money platforms for bill payment and money transfer. Angaza leverages these broad market trends to provide a low-cost, scalable implementation of PAYG pricing for solar power. Angaza customers take home a PAYG-enabled solar device for a nominal upfront fee, then prepay for energy by using mobilemoney to send micro-payments to Angaza on a flexible schedule.

Upon receiving each payment, Angaza uses the cellular network to activate the customer’s solar device for a proportional amount of energy. Energy use is then metered internally, and the device deactivates when the prepaid amount has been used. This metering provides remote enforcement of product financing, reducing the servicing costs inherent in traditional financing vehicles. When aggregate micro-payments meet the full price of the device, typically in less than year, it is “unlocked” and subsequent energy use is free. USAID DIV’s Stage 1 funding will support Angaza’s field research on PAYG operations in rural Tanzania, in partnership with SunnyMoney. SunnyMoney is the top distributor of pico-solar products in Africa, and has sold over 300,000 lights in Tanzania to date. The field test will focus on optimizing the PAYG sales process through SunnyMoney’s innovative last mile distribution model. During the 12-month project, Angaza and SunnyMoney will perform a staged rollout of PAYG solar devices, distributed by head teachers acting as trusted solar advocates in their communities.

Potential cost effectiveness, impacts, and implications

Angaza anticipates saving customers hundreds of dollars over the life of their units compared with weekly kerosene and phonecharging expenditures. The project will conservatively displace approximately 500 tons of CO2 emissions per year by offsetting kerosene combustion, and will bring affordable solar power to over 2,500 people. In addition, energy usage and payment data, and distribution best practices collected during the project, will be used to inform the scale up of PAYG sales throughout East Africa.

Learn more

Angaza is a for-profit social venture that develops PAYG technology solutions that break down the upfront price barrier to solar devices in emerging markets. For more information, visit http://www.angazadesign.com/ and follow us on twitter at @angazadesign or on Facebook at Angaza Design.

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